Slow Sales And Downward Pressure On Prices In California
The Appeal Democrat reports from California. “Yuba County ranked second highest in the state for the percentage of foreclosure sales last month, data shows. Nadia Artero, branch manager at Countrywide Home Loans in Yuba City, said she has noticed a large number of foreclosures in the area recently. ‘All you have to do is look in the newspaper every day at the notices of default,’ she said.”
“Appeal-Democrat records show that 85 ads were taken out for notice of trustee sales in June, compared with 60 in January.”
“Artero said a decrease in property values since October 2005 has contributed to the increase. Many people purchase homes with 100 percent financing and use adjustable-rate mortgages…and people end up owing more than their homes are worth.”
“‘People can’t afford the home, can’t afford to refinance and were probably stretched just to get the home to begin with,’ she said.”
“Once someone reaches foreclosure, it’s difficult to keep the home, she said. ‘That’s tough, really tough,’ she said. ‘It’s an ugly time right now for a lot of people.’”
The San Francisco Chronicle. “Foreclosures continued to rise throughout the country, the state and the Bay Area in June, according to a report to be released today. Nationally, 164,644 foreclosure notices were filed in June, up 87 percent from June of last year, said RealtyTrac.”
“In the Bay Area, the number of foreclosure notices was 5,018, almost triple the 1,780 in June 2006.”
“In the nine-county Bay Area, 3,383 households received default notices in June, more than double the 1,460 in June 2006. Alameda and Contra Costa had the highest number, with slightly more than 1,000 such notices each, followed by Solano with 557 default notices.”
“Notices of trustee sales in the nine counties hit 1,011 in June, more than triple the 281 filed the previous June. Again, Alameda, Contra Costa and Solano counties had the most such notices.”
“There were 624 Bay Area bank repossessions in June, a dramatic increase from 39 the previous June.”
“As the number of properties in such a situation increases, banks are more likely to allow the homes to be sold at a loss in a process called a short sale, or to be sold in a foreclosure auction, also at a lower value. That in turn will depress values of nearby homes.”
“‘That has an insidious effect across the state,’ said. If one thinks of default notices as the canary in the coal mine, ‘The canary has wheezed and gasped and is probably being carried out right now,’ said Rick Sharga, VP of RealtyTrac. ‘The excessive and lax lending practices of the past couple of years of the real estate boom are coming home to roost.’”
Inside Bay Area. “Foreclosure activity continued to rise sharply in the East Bay and San Joaquin Countyo, according to RealtyTrac.”
“In another sign of the housing downturn, Redwood City-based Movoto.com reported that the number of ‘distressed’ home sales is rising, as homeowners try to avoid foreclosure.”
“The number of homes in some type of foreclosure proceeding in June was about three times higher than a year ago in Alameda County and about four times higher in Contra Costa and San Joaquin counties, according to RealtyTrac.com.”
“San Joaquin County had the highest rate of foreclosure statewide, with almost 1 out of 100 homes in some kind of foreclosure proceeding. The rate is more than triple the statewide average, the numbers show. ”
“Foreclosures in San Joaquin County are hitting newer homes more than older homes, said Dave Konesky, a Realtor with the Tracy office of Prudential California Realty.”
“‘Mostly we are seeing it in the subdivisions that were built in the last seven to 10 years,’ he said. ‘In my gut, my feeling is that it’s mostly first-time home buyers. I think it’s loans resetting (to higher rates), but I also think there are situations where the husband and wife lost their jobs.’”
“As foreclosures are on the rise, so too are the number of existing homes being sold in the so-called ‘distressed’ category. That’s when a property is in some kind of foreclosure proceeding or in a short sale, which means the home is being sold for less than the mortgage to avoid foreclosure.”
“In Contra Costa County, 15 percent of existing homes on the market in June were listed as distressed properties, according toMovoto.com. In Alameda County, the percentage was 11 percent while in San Mateo County the number was 8 percent.”
“California had 38,801 foreclosure filings in June, up 287 percent from year ago but down 2.16 percent from the previous month, according to RealtyTrac.com. Most filings, 27,483, involved default letters, while 4,236 were homes that had been taken back by the lender. Another 7,082 were foreclosure auction properties.”
“Alameda County had 1,227 homes in foreclosure, up from 440 a year ago. Contra Costa County had 1,795 homes in foreclosure, up from 460 a year ago. San Joaquin County had 1,841 homes in foreclosure, up from 473 a year ago. San Mateo County had 150 homes in foreclosure, up from 124 a year ago.”
The Orange County Register. “Orange County had 1,647 filings, or one for every 589 households. That’s more than double June 2006, and up 27% from May.”
“The June total includes 1,308 notices of default, 269 notices of trustee’s sale, and 70 REOs.”
From Bloomberg. “California had the second-highest rate, with one filing per 315 households, and the most filings overall, 38,801, for the sixth month in a row.”
“Six of the top 10 U.S. foreclosure rates for metropolitan areas were in California. Stockton, Merced, Modesto and Riverside- San Bernardino occupied the top four spots. Vallejo-Fairfield was seventh and Sacramento eighth.”
The Central Valley Business Times. “Mortgage defauls in the Central Valley and the Coachella Valley are being blamed by PFF Bancorp Inc. for a charge of $20 million to $21 million it is putting on its books in anticipation of loan and lease losses.”
“‘The provision is primarily a result of credit weaknesses we are experiencing in the residential construction and land segment of our loan portfolio, as we continue to observe slow levels of sales and downward pressure on prices on a number of residential construction projects we have financed, particularly in the Central Valley and Coachella Valley,’ the company says in a statement Thursday.”
The Press Telegram. “At a leadership retreat for the National Association of Realtors at the Ritz-Carlton Laguna Niguel in Dana Point, incoming board president Dick Gaylord and a team of real-estate experts discussed the group’s strategy in the next year.”
“The position places the 30-year real-estate veteran in a position to be one of the industry’s mouthpieces, and it puts Gaylord at the helm of the group’s national policy efforts.”
“Gaylord…carries a positive message about the market. ‘I don’t know that there’s ever been a bad time to buy,’ Gaylord said, adding that aside from a few ‘dips,’ home prices will always continue to rise. ‘If people will hold on, there’s no bad time to buy in real estate.’”
‘Despite a glut of office space for lease and hundreds of thousands of square feet under construction, office landlords in Roseville and Rocklin signed new deals for more space than their tenants left, according to statistics compiled by broker CB Richard Ellis.’
‘The area region has 887,000 square feet of vacant office space that could take two years to three years to fill. And that doesn’t even take into account another 755,000 square feet under construction, according to the latest CB Richard Ellis tally. All of that inventory could force lease rates down.’
‘As this year’s second quarter closed, some experts feared the housing market’s collapse had pushed out so many home finance, mortgage and insurance businesses that Roseville and Rocklin might see more office square feet vacated than newly leased for the first time since 1994.’
‘It’s not the market that’s sick; the market’s healthy,’ said Chris Strain, executive director of brokerage Cushman & Wakefield’s Sacramento office. ‘There’s just too much darn supply.’
there is just not that many jobs to fill that space - they are all in india and china
With unproductive Indian engineers approaching American salaries look out. The H1b flood gates will be opened.
Reason for catch up is:
1) Indian Currency +7 % in 1 qtr.
2) Indian engineers get 10% + pay raise every year.
You now pay 70 K for engineer with 5 years of experience.
Before American engineers can cash in they will open the flood gates. These bodes well for large apartment complexes.
Are you referring to Indian ‘engineers’ in the US or India……
Indian engineers in India.
Rupee will go up another 10 % by end of year.
Both Hillary and Obama are in favor of More HB-1 visas. Hillary especially ahas been working both sides of the street, but telling her corporate sponsors that she favors unlimited HB-l visas. As a former Dem, I feel I should alert people who believe that the dems protect the interests of american workers. Bill Gates of course favors unlimited HB-1 visas, which would crush the wages of educated Americans.
Has any country ever had so many “leaders” who want to impoverish their own citizens?
I’m still a Dem - an Edwards guy - and that really ticks me off. But it’s not surprising… pretty much every “leader” is a puppet on a corporate string above a certain level. Wonder if we’ll wake up in time?
The market is healthy… there’s too much supply.
Hello!!!!! If there is too much supply, then the market is NOT healthy!!!
She’s not fat … she just has too much adipose tissue. What is wrong with these people; sometimes I feel like I’m reading housing bubble bloopers.
The same thing is happening here in Bozeman. The former Hardee’s is now a pile of rubble, it is going to be a office building. The former Chambers-Fishers depatment store (the Golden Rule building) is being converted into an office building. There are a number of project on 19th and Oak for new office buildings. This is going on even though there is vacant office space all over town.
Two years ago in Bozeman we were in a very small 2 bedroom ($425/mo) and with a new child on the way, we looked at both moving into a larger apartment or renting a space nearby for a semi-home office. In the end, I rented a 1 room office in a nice building just off downtown (Lamme) for $100/mo and month to month lease. THere was a ton of vacant office space even then, hard to believe they are building more space… or that rents could justify the current cost of construction.
This overbuilding is truly frightening. It’s not only a hideous waste of natural resources, but it leads to urban blight. WTF are these greedheads thinking? These developers have lost their collective minds. I cannot fathom how they are justifying these projects. Leave some fricking land untouched, eh @ssholes?
They are! I think it’s over in Eastern Montana somewhere…..
Well, they were planning for the immigration bill to pass and for the population to double as a result. Of course, they really don’t give a rats a*s about American culture.
I wonder what really is “American Culture” anymore. Love of money? Greed? Avarice? Bearing false witness or coveting? Take ur pick.
The new American motto is….
MORE!!!
Apologies if this has been posted earlier but this is a “must read” by Itulip concerning mortgage default issues. The second half facts are eye openers!
http://www.itulip.com/forums/showthread.php?p=12232#post12232
WOW! Those charts really lay out the coming disaster clearly and simply. I’d say this item deserves to be posted by Ben in an upcoming blog entry.
Is it just me, or is that “Months to reset” chart confusing?
It all makes sense, brilliant in it’s clarity except this:
“”Five years ago, the post stock market bubble ends and the housing bubble starts here”
By that logic, what we refer to as the housing bubble is really the post stock market bubble. Anyone else get a different result?
Agree w/ gwynster. I think the author doesn’t realize the mysterious correlation between the drop-off at 60 mos mark and the prevalence of 5/1 ARMs / POAs (He’s pointing to the wrong side of the hump!)
Also, the comment at 24 mos doesn’t make sense either. Author, again, doesn’t realize that both “humps” of mortgage resets result from mortgages that were originated at the same point in time. Some were 5/1s some were 2/28s. The two year is the first hump, the 5 year is the second hump.
There are not commonly 4-year “fixed” adjustables and thus the lull. You could either point to the lull and say “5 years earlier we ran out of good credit buyers” or you could point to negative mos til reset (off left side of chart), find the lull that’s passed and say “2 years before this we ran out of rational subprimers”. Both make sense because, in retrospect they offer future hindsight to the then-forecoming boom in terrible borrowing logic.
Gold stars for anyone still reading
I like the radioactive emblem, nice touch. Definitely confusing.
Sort of a countdown to the zero point: not the typical graph for this type of data. The only thing missing now is Jeff Goldblum, from “Independence Day”, gazing at this graph on the screen of his laptop and saying, “Time’s up”.
I see tons of open office space around OC, california. Am I the only one noticing? Especially Irvine and Costa Mesa, lots of for-lease and available office buildings, warehouses, and such.
Tons of vacant office space, industrial, and retail in NV, OR, and WA too.
And NoVA
“Inside Bay Area. ‘Foreclosure activity continued to rise sharply in the East Bay and San Joaquin Countyo…”
San Joaquin County Yo!
Represent!
I say we graciously extend the Inland Empire, all the way to Sacramento…
“Six of the top 10 U.S. foreclosure rates for metropolitan areas were in California. Stockton, Merced, Modesto and Riverside- San Bernardino occupied the top four spots. Vallejo-Fairfield was seventh and Sacramento eighth.”
FINALLY!!!!!! Finally, finally, finally, some good news for those of us in the bay area. It’s ABOUT TIME.
IAT
It’s just like that rollercoaster image that made the rounds on CL’s housing forum showing the which region would decline first. Congrats on getting past your peak >; )
Gaylord…carries a positive message about the market. ‘I don’t know that there’s ever been a bad time to buy,’ Gaylord said, adding that aside from a few ‘dips,’ home prices will always continue to rise. ‘If people will hold on, there’s no bad time to buy in real estate.’
Okay, did this idiot just say “Except for when it’s not, it’s always a good time to buy Real Estate” with a straight face? Except for a few dips, Real Estate always continues to rise may be true, but he glosses over real vs. nominal price gains, effects of dips, how long those dips can last, and the effects of those dips on people forced to sell, and how a dip might affect people in the highly leveraged RE market of today. Gaylord obviously needs to take over for Yun, as Yun isn’t nearly as bald faced a shill as Braylord.
It is always a good time to generate fees for the RE complex. How else can they pay for their BMWs and MBs?
On a side note, noticed more sales of properties owned by a RE agent/broker. Some homes looked very and thus must be their own home vs. a rental.
left out “.. looked very nice and thus…”
Yah, I think the Realtors who bought houses based on their 2004-2006 commission checks are struggling with their 2007 commissions. My guess is you’ll see a lot of them losing their shiny new houses. And many newbies will be turning in their red coats and finding some real work.
You’d think that. But you’d be surprised at how many people in the Bay Area still want to get into real estate. At least once a week I see some zealot on the bus or train reading an RE training book. Astounding…what rock do they live under?
They HAVE to sell, but CAN’T pay 6% so they are studying to get licensed themselves so they can get it into MLS and sell it with only 3% to the buyer agent.
Or they’re trying to cut the 3% out by being their own buyer’s agent. I thought about getting licensed (what, a weekend course and maybe 2 nights of study) to try that, but it turns out you can’t be a buyer’s agent unless you work for a broker.
Ok true story.
There is a house on the MLS in Woodland. The owner contacted me a few months ago about taking it off the market and renting it out. She was somewhat anxious because it wasn’t selling and she didn’t understand why.
Her reason for buying? She lives in Palo Alto and homes are so expensive there that this place had to be a steal. All she had to do was hang onto it for 2 yrs and then flip
MLS #: 70040207 It’s been relisted at least once. She’s now underwater. I wish our conversation had been via email instead of by phone so I could share all of her delusion and dismay in it’s technicolor glory >; )
Speaking of RE agents, I was just talking to this small business owner down the street from me. She says she’s been living in her store at night because the RE agent who sold her house for her while she was ill practically stole it from her, marketed the thing for 8 months then sold it to another COLDWELL BANKER agent, who moved in a week early, changed the locks and took all her jewelry, diamonds and furniture that were still in the house. She’s so busy running her business and dealing with her ulcer that she barely has time to hire an attorney to deal with this, plus she’s practically homeless. Told me she was throwing up blood on the sidewalk and calling 911 as they refused to let her in the house to get her things. Just one side of the story, of course.
uhhh, i find this story hard to believe
i don’t know who’s, ….but someone’s meds need adjustment
There are over 4000 BMWs for sale in the SFbay area.What does this mean? Huh? Huh?
It’s time to go uproot another Joshua tree.
‘I don’t know that there’s ever been a bad time to buy,’ Gaylord said, adding that aside from a few ‘dips,’ home prices will always continue to rise. ‘If people will hold on, there’s no bad time to buy in real estate.’
Apparently PCP is back in fashion. Lord, help us.
if your’e foreclosed on, is it always a great time to buy real estate?
‘If people will hold on, there’s no bad time to buy in real estate.’”
yep.. just a matter of hanging in there.
If people will hold on, there’s no bad time to buy acreage on Neptune.
“yep.. just a matter of hanging in there.”
Doesn’t hanging usually involve a noose?
The thing that makes me upset is you have idiots like this and everyone else at the NAR that have a vested interest in sales volume managing/fudging sales statistics and data and spending millions dissemination their spin to the media. There really should be some oversight here to ensure accurate data is available by someone with no vested interest.
They’re not idiots. Evil, greedy b@stards, yes. But stupid? No.
RE: accurate, spin-free data. That’s what this blog and others like it are for. Good luck getting the industry –or government– to ever produce reliable information free of influence from powerful vested interests.
Of course, if the media would start doing their jobs, they might occasionally point out the inherent conflict of interest and start quoting non-REIC sources. But of course they can’t, as they themselves heavily rely on REIC-generated advertising revenue.
imo it’s more of a symbiotic relationship. Realtors need to reach the masses. Without the media their advertising efforts are reduced to .. what.. junk mailings? infomercials?
“Gaylord…carries a positive message about the market. ‘I don’t know that there’s ever been a bad time to buy,’ Gaylord said, adding that aside from a few ‘dips,’ home prices will always continue to rise. ‘If people will hold on, there’s no bad time to buy in real estate.’”
He’s right…if you bought in 01-02 and now have plenty of leverage room, otherwise your’re f’d. What kills me is that this schmuck still thinks it a good idea for a first time buyer with median income to buy right now. Idiot.
Chances are that leverage room you speak of has been leveraged. Can you say MEW? I can ’cause I saw it go down. Many who bought in 01-02 are currently upside-down too. So i say to Gaylord that it’s never a bad time to buy unless you’re counting on home appreciation to take care of your bills and lifestyle.
It’s truly amazing how many folks out there are totally unfazed by the current bit of reality that’s rearing its ugly head. “Great time to buy - so much selection”; I mean it’s un-freakin’-real.
I’ve asked several people: “Could you afford to buy the place you’re in right now at the current price?” and they kinda say “It’d be a stretch”…
Wow.
Casagrand on San Diego June numbers:
http://realtytimes.com/rtmcrcond/California~San_Diego~bobcasagrand
I wonder if the June re-sale numbers includes the 738 trustee deeds?
“June 2007: San Diego Housing Market: single family attached and detached homes; The slide continues. Sales for June were 2,370 homes this is down from June 2006 by 29% and June 2005 by 46%. Inventory for June was 21,991 up from the 2006 inventory of 19,803 and 2005’s 10,910. This increase in inventory and declining sales has inventory supply at almost 10 months and continues the downward pressure on prices. Prices are dropping across all size homes except for the 2200 sq ft to 2500 sq ft size range. The amount of the price decline depends on the size range with the smaller homes showing the largest decline. Currently approximately 12% of our Active listing are listed as short sales which is another indicator of our price slide. Pending sales in June of 2,289 indicates that sales decline is still with us. Sales for the second quarter were 7,445, reminiscent of a winter quarter not the peak selling season. We are on a path to sell 25,000 or fewer homes this year compared to in the 40,000’s in the years leading up to 2006 when we dropped to 31,000. As long as we continue with the large imbalance between sales and inventory we will see downward price pressures.
Enough for the numbers. I think it is important for us to realize how we got here and what it will take to at least get back to a price neutral market. What follows comes under the heading My Opinion. Depending on which report you read San Diego is either number 1 or number 2 in the nation as the most overpriced housing market. The ratio of median house price to median income is 10.5, which means that it takes 10.5 years earnings for the median income family to purchase a median priced home. This coupled with increasing interest rates and more restrictive lending practices has significantly reduced demand for housing, putting our sales down 40% from 2005 levels. The desire to sell homes has remained fairly constant which with lower demand has pushed the inventory to about 10 months supply, resulting in downward price pressure. There exists pent up demand for houses, if people can afford them, so as the affordability index reduces more people will come back into the market, demand will increase and inventory supply will reduce and downward price pressure will reduce.”
“Pent up demand for houses” Ya, sure. Pent up demand for a Lexus, new RV, New easy job, all demands but can you afford the price? Bought will savings or need a lot of credit to buy it? How’s your debt levels on things already you bought, demand was there and you sure got it. Now the fun starts with “paying it off” on all those things you demanded. Am afraid demand for a new or upgrade house will now be a lot harder as there are few lenders who are fools now for easy credit unless a good down payment you have to put down on that new house. Equity from current house will be a lot smaller in a down market and thus little activity or desire to take on larger debt levels. Demand will mean little unless the buyer can “really” afford that new home in San Diego of course unless the big paying jobs stop going out of the country and foreclosures all but stop. Demand means nothing!
Fess up Ben. You’re making up these names. You don’t really expect me to believe someone named DICK GAYLORD is the new MOUTH piece for the NAR?
I had to follow the link to make sure it didn’t link to theonion.com or something like that. I think it is legit. What a fitting name to the incoming board president of the NAR…
GE to sell SubPrime branch
I am not sure how they will account for it, what will happen to the losses and the potential implosion.
Good Bye Liquidity
Awesome!
I expect some private equity firm with lotsa liquidity straight out of the Milky Way to snap up GE’s subprime branch.
I expect to hear the words “we see value” when someone buys GE’s subprime junk. just remember to make a commitment to the sale like what GM/GMAC did.
“I expect some private equity firm with lotsa liquidity straight out of the Milky Way to snap up GE’s subprime branch.”
And thusly prop up the stock market due to “hot takeover activity”. So freaking frustrating.
‘If people will hold on, there’s no bad time to buy in real estate.’
The sad thing is, there will be many GFs who will listen to this advice, buy, then default on the note in a few years. Of course, they will sue, claiming that it wasn’t their fault…they just happened to sign documents that overstated their income by three-fold. I’m getting tired of the lack of personal responsibility as well as the idiocy coming out of the NAR. Really, only if your IQ is less than your shoe size should you see any credibility in what they say anymore…yet the MSM love to quote their overly optimistic garbage.
http://phoenix.craigslist.org/rfs/372516342.html
Wow…
That place isn’t worth half that. Peoria isn’t even a good area. Throw another FB on the foreclosure fire.
He owes 548k, he’s selling for 545k, plus giving the buyer 25k cash. That’s amazing for being this early in the crash. It would be interesting to see what they are comping for in that area.
“and you can have it all, my empire of dirt”
“and you can have it all, my empire of dirt”
And the RE community can take up the rest with, “I will let you down, I will make you hurt.”
“Everything fell apart.”
He ain’t seen nothin’ yet. Once again, the usage of the past perfect when he’s only coming up to bat in the top of the 3rd.
“I purchased this home in 12/2005 with the intention of building my family in the new community, but everything fell apart and I was relocated. My loss is your gain….”
I think the old Mad Magazine’s, “what he said, and what he meant to say” would fit this guy…..
“I purchased this home in 12/2005….”
In 2005, I got a 1.95% NINA interest only teaser rate loan, and have been happily renting cheap cash from the bank so I could call myself an owner.
“…..with the intention of building my family in the new community….”
“THE” new community…… for god sakes, not this one.
“….but everything fell apart and I was relocated…..”
Yes, the Casey Serin “Passive Income” correspondence course and all the CD’s have, well….. fallen apart. I have been relocated back to my old career in charge of lettuce.
“My loss is your gain….”
It would really work out well, if my lack of information and due diligence was bailed out by your monumental ignorance…..soon. Since RE only goes up, this is a win-win for both of us = a gain.
If he gives me the 25k in cash, I’ll offer him 25k for the house.
“This home has 2 loans:
356000 & 189000 … Let’s make a deal.”
That’s pretty funny. No, the house doesn’t have two loans, you do…sucker.
LOL!! No $hitt Funny stuff, he was going to move his family in. Yea right, we know what fell apart, your flip… flopped! You know this clown thinks he’s slick, but his ass is against the wall. Lessons learned the hard way are best learned. Of course it’s not fair, please bail my sorry butt out, and you can hold the bag.
“LOL!! No $hitt Funny stuff, he was going to move his family in. Yea right, we know what fell apart, your flip… flopped!”
I wonder if his family members are exhibitionists because there appear to be no blinds or curtains on the windows of this beauty.
If you search on the Phoenix MLS for the same exact square footage (3,081 sf) in the same subdivision, you get models listed as low as $430K (MLS # 2687848). No similar model appears to have actually sold in 2007.
Asif paid Pulte $419,550 in December ‘05.
“but his ass is against the wall”
He’ll have to turn around soon enough. . .
… check this place out on Zillow:
http://www.zillow.com/HomeDetails.htm?zprop=67798977
ZESTIMATE™: $387,912
Owner’s Estimate: $649,418
Bit of a disconnect there huh?
Not to mention he’s been been paying for 2 years with no rental income (if it’s never been lived in). Is this the worst flip so far?
In Phx anyways…
No, I think the owner is doing just FINE. Note that his neighborhood seems to be priced in the upper 300s. So his first mortgage (356000) is probably 100% financing of his original purchase. His second mortgage (189000) is probably what he pocketed (mortgage fraud). Looks like his flip is working out fine for him, not so well for the lenders! Hope he saved some of his “take” rather than spending it all on toys.
Yea, funny stuff I did a search on his name in the Maricopa County Database. Seems like it’s a flipper gone bad. He has mailing addresses all over the place. Looks like that second loan may be a figment of his imagination or I couldn’t find it in my search. Either way he’s about 200k over market.
In case anybody missed it, it’s the same place as above.
Also, zillow estimated this at $261K in late ‘06 and for some reason has jacked it up a hundred grand. Vegas, SoCal, and Fla. all have their bubbles, but seems to me that Phoenix has more outrageously overbought/overpriced garbage houses than anywhere.
Zestimates zuck.
Buy my home and i’ll give you $25,000. Sell it to a GF and give them only $20,000. You pocket 5 thousand dollars.. for free! and you can do it all in your spare time!
Now, I know this sounds too good to be true, but I can tell ya.. it happens every day!
That’s one fugly house even at half the price. I especially admire the apparent necessity to cram it within 5 feet of the adjacent house, despite its situation in the middle of a desert. That is very efficient from a mass transit perspective. He didn’t mention which subway station is closest, but I infer that there must be one within a block or two?
Remember reading how 1:53 was a Realtor in California? LOL
WalMart is California’s largest private employer.
1/3rd of the workers in California work for the government (US, State and local)
1/3rd of the workers in California work for Not for Profit Corporations (Hospitals, schools, United Way etc.) see Committee on national statistics the not-for-profit sector of the economy: measurement and presentation in federal statistics 2005
so 2/3rds of California’s population is supported by 1/3rd of which the primary component is WalMart.
A really viable situation. How much longer before foreclosures force layoffs in the not for profit sector? (My assumption is that government jobs are immune.)
no overlap between govt and non-profit.. like public schools?
I expect there is plenty of overlap! Per methodology if an individual is working in the Military and doing a 2nd job at the mall, he is only counted once as a privately employed individual.
Ditto if an individual is working at a private research lab funded by the government, he is considered privately employed. Government grants, research grants are considered private employment.
Links to bLs and calmers are provided below.
If there is overlap, and the above example is used, of a public school (fill in the blank), are they counted twice thus overstating employment figures in this particular measure?
Considering that the entire RE industry just became “not for profit,” I’d say we’re already there.
Well, the thing I find ludicrous about this is the non-sequitur that government and non-profit are totally supported by the profit sector.
Everyone who works supports everyone else. For instance, an non-profit hospital employs doctors, nurses, support staff, etc. and these people provide services for which they are paid. They then go out and spend that money in other sectors (whether profit or non-profit). A for-profit hospital operates the same way except that the owners skim off a profit. The value or “wealth” comes from human labor either way. Money is just a way of exchanging labor without having to resort to barter. A for-profit business may well operate more efficiently but that doesn’t mean all wealth in the economy flows from the for-profit sector, especially if, as you have pointed out, 2/3 of the labor is being provided by the other sectors.
And of course it is also a leap from saying WalMart is the largest private employer in California to saying that it is the primary component supporting California. (I live in California, why do I not know anyone that works at Walmart?) If there are lots and lots of employers, you can be the largest and still not dominate.
Don’t get me wrong, I am sure that the California economy is on the brink of a big disaster, largely due to the real estate situation, I’m just not convinced the statistics you quoted are that relevant.
I’m curious about your final statement. I actually disagree about government jobs being immune — maybe in the short run, but in the long run the tax revenues will decline sharply and a credit crunch will make bond issues basically not viable, so California will _have_ to lay off eventually.
But leaving government aside, I am curious why you think the non-profit sector would get hit by foreclosures more than the profit sector. I mean, I figure a general recession is going to occur before long and force layoffs _everywhere_ but I wouldn’t have singled out the non-profit sector as being particularly susceptible. I would have thought that the financial sector would get hit first (already happening in a small way with many of the subprime lenders going out of business) followed by the retail sector (including WalMart — they had a reprieve last month, but I think the first sign of consumer spending collapse will be the discount retailers doing a little better as the upscale retailers crash and burn, and I think you can see evidence of that in today’s sales reports).
“I actually disagree about government jobs being immune — maybe in the short run, but in the long run the tax revenues will decline sharply and a credit crunch will make bond issues basically not viable, so California will _have_ to lay off eventually.”
In related news, Omaha is laying off government workers as they (and the entire state of Nebraska) have been in a budget crunch for quite some time. They’re even laying off cops and firefighters!!! Outrageous!
Hoz do you have a link for those numbers you posted?
Calmis.gov
http://tinyurl.com/24ktw3
this is for the states unadjusted employment.
e.g. a research firm receiving government grants is not considered government funded.
The Bureau of Labor Statistics June 2007
http://tinyurl.com/t68g
(check how much of the employment gain was in gov and health)
Any other stats needed?
I do not know why my other links do not show up.
in 2002 based on the 2000 census 5.4% of the states total population-including children and aged etc. worked for the state and local government - US Census. total pop 33,872,000 - State employees 1,775,000: US Gov employment 244,800, total employees in state-health care 1,655,000 total employees in the state (2002) 13,239,200;
(all local, state, gov, and health care are included in state total employment figures - these figures also do not break out 501C corps which include the Salvation Army, United Way, election Campaigns and PBS etc. These figures also exclude all military personnel since they have no impact on the local economy.)
Are my numbers off? Probably! But not by very much. It may be 30% works for the Gov and 30% works for NFPs. Based on the internet search for NFPs in California - I suspect there are more than can be legitimately accounted for.
http://tinyurl.com/yt85lq
here’s the thing that confuses me..
All these govt workers, teachers, etc. spend their money in the local economy.. on rent, groceries, car repair.. and that money ends up in the private sector as profit and paychecks. So.. can it be so clear cut as to who is supporting who?
Yes, because it’s not who spent it but from whence it came.
Private industry earns your business, whereas government forcibly takes your money from you. The latter cannot exist without the former, otherwise there’d be nothing to take.
Politics aside, as far as the contention that the private sector supports the public sector, it doesn’t matter if one considers taxation forced upon us or agreed upon by us… this is about money and numbers.
The question is about the circulation of money in the local economy and, in the end, who supports who and to what degree.
here’s an example:
I pay lots of business taxes. I manufacture #2 pencils and sell them.
The govt is my largest customer by far.. they take 95% of my production.
They pay for my pencils partly with my tax money that I paid them with. So, i get my tax money back.
Who supports who in this situation?
Sure, ultimately the tax payer pays for everything.. or more properly, the consumer pays for EVERYTHING, with or without a government…
“Gaylord…carries a positive message about the market. ‘I don’t know that there’s ever been a bad time to buy,’ Gaylord said, adding that aside from a few ‘dips,’ home prices will always continue to rise. ‘If people will hold on, there’s no bad time to buy in real estate.’”
I’m holding on — until the coaster reaches the bottom of the hill.
GS, I answered your question on the Bits Bucket. “What keeps it going?”
For some real-estate market analysis for the Santa Clara county and neighboring area (San Mateo, Montery and Santa Cruz), check out these links -
http://www.creeksiderealty.com/bay_area_real_estate/2007/summary/7jul.htm
and
http://www.creeksiderealty.com/market_update_new/market_index.htm
The realtor Richard Calhoun does a decent job of the MLS data analysis each month. And he is honest about the MLS data. He warns about the MLS data:
Warning
Since the MLS transition in July 2003 there have been numerous challenges. Unfortunately, we continue to question the accuracy of the MLS database, which is our source for our analysis. The most significant remaining issues are:
1) DOM (days on the market): This use to be the length of time a property was published on the MLS. Currently, this data is based on the list date entered by the listing agent. This means that DOM can be reset to zero at any time by the listing agent by simply re-listing the same property and may have no relation to when the property went onto the MLS. As the market slows down more agents will re-list their properties. Therefore DOM will be low and not accurately reflect the degree of market slowing.
2) Number of initiated Sales: This is still being significantly overstated. Previously, the sales date was the date the sales was first reported to the MLS. Currently, there are several events that cause this sales date to be over-written by a current date. If this happens to be in a subsequent month then the initiated sale will count in both the original AND the subsequent month.
3) Number of Closings: This is also being overstated, but to a much smaller degree. Sometimes the MLS fails to delete the original listing when an agent re-lists a property. The listing agent reports the sale and closing on both listings causing a double count. This also cause an over stating of the inventory when the listing prior to the offer being accepted. We have also found a listing that closed in December 2003 but was being reported by the MLS as also closing in May 2004.
OT - and probably a stupid question, but what does ‘looking for backup’ mean on the MLS? How is it different from ‘active’?
I tried to find a FAQ on terminology on the MLS, but failed.
“10. REPORTING SALES AND OTHER INFORMATION TO THE SERVICE.
10.1 Reporting of Sales. Listings with accepted offers shall be reported to the
MLS or input into the MLS database as “pending” or “looking for back-up”
and/or “(Contingency to Back-Up Offer) CYB” and “(Contingency to 1st Right of
Refusal) CYR” within 48 hours (excepting weekends, holidays, and postal holidays) of the acceptance by the Listing Broker unless the negotiations were ”
http://www.srar.com/members/MLSRules/07MLSRules.pdf
Thanks!
I would imagine it means they already have an accepted offer, but it’s a shaky deal (due to financing or other contingencies).
The wheels have already been set in motion for the ultimate crash. There’s nothing anyone can do about it. Have you seen whats going on with the Ron Paul Revolution?
There’s nothing anyone can do about it.
Yes and no. Can’t stop it, but we can certainly prepare ourselves for it!